A great variety of biguanide and sulfonylurea compounds have been conventionally employed as a therapeutic agent for diabetes. However, biguanide compounds cause lactic acidosis and therefore, are hardly used at present, while sulfonylurea compounds exhibit potent blood sugar lowering activity but often bring about serious hypoglycemia, thus requiring the precautions for use. The present inventors, after extensive research to find a compound having blood sugar lowering activity which is free from such drawbacks, discovered certain novel thiazolidinedione derivatives having excellent blood sugar- and lipid-lowering activity.